This Code of Practice (“the Code”) sets out best practice standards for Fund Managers of Hedge Funds in the DIFC (i.e. Fund Managers of Domestic Hedge Funds that are Public Funds, Exempt Funds or Qualified Investor Funds). These are designed to address risks inherent in the operation of Hedge Funds and are set out under 9 Principles as follows:
Principle 1 – A Fund Manager of a Hedge Fund should have, or have access to, appropriate skills and resources to conduct the operations of the Fund (see paragraphs 3 – 6);
Principle 2 – A Fund Manager of a Hedge Fund should develop and implement a robust and flexible investment process to suit the objectives and
risk profile of its investment strategies (see paragraphs 8 – 9);
Principle 3 – A Fund Manager of a Hedge Fund should have systems and controls to mitigate trading related risks such as price overrides and failed trades (see paragraphs 10 – 12);
Principle 4 – A Fund Manager of a Hedge Fund should have adequate back- office systems and controls to avoid backlogs in trade confirmations (see paragraphs 13 – 15);
Principle 5 – A Fund Manager ...